Charting A New Course

Among the many factors that influence the higher cost of airfares in Canada is the ownership status of the nation’s airports, reports western editor, Ted Davis in this week’s digital edition of Canadian Travel Press.

There is still no word from federal transportation authorities on what the future holds for Canadian airports in terms of ownership, but there is plenty of speculation and opinion on where this issue is heading.

While some voices are advocating for full private sector ownership, other stakeholders express misgivings with this strategy, and support a business model that follows a not-for-profit ownership model by airport authorities.

One thing that everyone seems to agree on is that careful consideration of business model alternatives is necessary – and that changes are needed to address high airfares.

Canada is number 70 out of 75 of the most expensive nations for airfares in terms of the average cost to fly 100 km., at US$38.71, according to kiwi.com. The US is number 17 on the list.

Rentals paid by airport authorities to the federal government are partially reflected in these airfares, as airlines seek to recoup fees paid to airports.

Airports are seeking ways to reel these rental rates in. But “we have to look at all the airport models around the world and avoid any pitfalls that they have experienced,” says Christiane Beaulieu, VP communications and public affairs at Aéroports de Montréal.

She recognizes, for instance, that fully owned, privatized airports are responsible to shareholders and must consider posting profits as a priority – potentially even ahead of customer service.

For the full story, check out this week’s digital edition of Canadian Travel Press by clicking here.